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    22 November, 2023

Happy hump day!

The sun is shining here in Melbourne and our portfolio company ASX:LMG is making some great progress!

Read below for an update.

Across Markets…

  • ASX pulled back slightly, tracking New York
  • Nvidia reported another record earnings, amid tepid reaction from investors
  • EBOS Group down despite strong start to financial year

The ASX pulled back by -0.1% on Wednesday, tracking overnight movements in New York where sentiment dropped after the release of the US Fed minutes from the last meeting.

According to the minutes, board members have not shut the door on another rate hike, and would raise rates further if data suggested that progress toward the 2% inflation was insufficient.

Traders also watched Nvidia’s shares closely after the chipmaker reported its quarterly results post the closing bell.

Nvidia got a tepid reaction from investors and tumbled almost 1% despite continuing its string of blistering quarterly earnings reports. The company easily beat its own guidance by US$2bn after Q3 sales tripled from a year earlier to US$18.1 billion, while profit surged 14x to US$9.2 billion.

The result wasn’t enough to lift the ASX Tech sector today as it dropped by more than 1.5%, which was offset by modest gains from Utilities.

Amongst the ASX gainers today was Origin Energy (ASX:ORG) and insurance stocks QBE (ASX:QBE) and Suncorp (ASX:SUN).

Decliners were led by health group EBOS (ASX:EBO), which fell -4.5% after providing a market update (see more details below).

Around the region, Asian stocks were mixed after Israel has reportedly approved a hostage deal and a pause in its war with Hamas. China’s Baidu Inc was a top performer, up 5% in Hong Kong following better-than-expected Q3 results.

Looking ahead tonight, key data releases and a UK budget update are expected, as Wall Street heads into tomorrow’s Thanksgiving holiday.

Source: Stockhead

Pic of the day

Local Equity News

Latrobe Magnesium (ASX: LMG) expects to gain a number of benefits from a new financing arrangement for its innovative magnesium production pilot plant in Victoria’s Latrobe Valley.

The company has inked an agreement to lease finance some $10.4 million of its demonstration plant equipment for the life of its project.
The lease finance is projected to reduce Latrobe’s ongoing debt levels to around $5.1 million from 1 January 2024.

This takes into account repayment of debt of around $12.6 million from Latrobe’s R&D tax rebate, relating to the year ending 30 June 2023.

The company said the lease finance has a lower effective cost of funds compared to those of its existing project finance facility and other funding options Latrobe has considered.

There is no obligation to buy the equipment at the end of the lease.

Targeting early 2024 production

The new leasing arrangement is just one of a number of cost saving actions Latrobe has introduced as it closes in on its first commercial production from the pilot plant.

The company has also incorporated an early cash flow opportunity once the pilot plant comes online.

The company is fast-tracking an option to on-sell smaller amounts of magnesium oxide (MgO) and has recently purchased a magnesium oxide bagging plant and other essential components to allow it to quickly commercialise this bonus cash earning option.

The introduction of the early MgO offtake is also expected to assist the Latrobe team to familiarise itself with the company’s patented hydromet process.

Latrobe’s pilot magnesium production plant in the Latrobe Valley will utilise a world first patented extraction process.

The plant will feature the extraction and sale of magnesium metal and cementitious material created from an industrial fly ash waste resource obtained from the nearby Yallourn brown coal power generation facility.

Major increase in workforce

Latrobe recently confirmed that it expects initial production from the plant to commence in March 2024 after it was successful in significantly boosting its work force.

The additions to the development team included fitters, welders, riggers, scaffolders, electricians, instrument technicians, supervisors, technical assistance, completions work pack engineers and quality assurance /quality control inspectors from two major local contractors.

The project is currently focused on fast-tracking the construction of key areas within the plant, including ash handling, leaching, pyrohydrolysis, and magnesite and the production of the one-ton bulk bags of MgO.

Click here to read more.

Source: Small Caps

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If you would like more information on future Peak deals, please don’t hesitate to get in touch.

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